The last thing you want to do is frantically run up to your boss asking “How many allowances do I claim on my W-4?”.
Being aware of the number of allowances you are claiming on a Form W-4 [Employee’s Withholding Allowance Certificate] is important for a variety of reasons. Most importantly, the number of allowances you claim on a W-4 determines the following;
- how much tax will be taken from your income (aka the withholding amount)
- the size of your tax refund
Steps to filling out a W-4
You’ll need to follow four simple steps when filling out your W-4 Form:
- Fill out your personal information (Name, Date of Birth, Address, Marital Status)
- Know the number of personal and dependency exemptions you are claiming on your tax return.
- Based on the number from step 2, use that number to help determine your number of allowances.
- Don’t forget to sign the W-4 and turn it into your employer!
The allowances you claim while filling out a W-4 if you are single will differ from the allowances you claim if you are married or have kids.
Claiming zero allowances
- The maximum amount of tax is withheld. Meaning, when it comes time to file your tax return you will most likely receive a refund.
- You’re being claimed as a dependent on someone else’s tax return.
Claiming one allowance (ideal if you are single with one job)
- You’re single and have one job. Claiming one allowance will most likely result in a refund when you file your taxes.
Claiming two allowances
- You are single. Claiming two allowances will get you close to your tax liability but may result in tax due when filing your taxes.
- You’re single and work more than one job. Claim one allowance at each job or two allowances at one job and zero at the other.
- You’re married.
Claiming three allowances
- You are married with one child.
Claiming additional allowances
- File as head of household if you are eligible. You are able to claim additional allowances.
- You had at least $2,000 of child or dependent care expenses that you plan on claiming credit
- You’re eligible to claim the Child Tax Credit
Can I fill out a new W-4 form?
Yes, employees can submit a new W-4 form to their employee at any time during their employment. Have you recently started a second job, had a baby, or tied the knot? Life changes such as these should encourage you to update your W-4 withholding.
A great tool to help you while filling out a W-4 is the IRS Withholding Calculator, located on the IRS website.
Claiming zero allowances means less take home pay, but a bigger tax refund during tax season.
The number you report on a W-4 will ultimately determine your take home pay and your tax refund. Don’t write down any number. Take the few extra minutes to really assess your situation and fill in the W-4 accordingly. By doing so you’re less likely find yourself in a difficult financial situation.
Then, when you’re ready to file your taxes, you’ll have a heads up on whether or not you’ll be receiving a tax refund!
My 26 year old son started working a part time job. Should he claim 0 or 1 allowances on his w-4? He is making $9.50/hr. What would be the difference in taxes withheld when claiming 0 or 1?
Also, can my husband and I claim him on our taxes if he has lived with us all year and just started working again after recuperating from surgery?
Hi Blanca,
Great to hear that your son is back to work after undergoing surgery!
In order to claim him as a dependent on your tax return, he would need to fit the requirements as a ‘qualifying child’ or ‘qualifying relative’. You have provided me with the fact that he is 26 years old so that would disqualify him from being a dependent child as he would need to be under 19 years old (24 years old as a student). In order to be considered a ‘qualifying relative’ and be claimed on your joint tax return as a dependent, your son must meet ALL of the following requirements:
1. He must live with you all year.
2. He must be earning a gross income of less than $3,950 annually.
3. He must be more than 50% financially supported by you and your husband.
4. He must not be claimed by anyone else for the tax year.
When it comes to completing his W-4 form, he would be most financially benefited by claiming zero dependents. This will ensure that he does not owe the IRS come tax time.
Hello
I’m recently married and just started a new job. Do I still have the option to select single on my w-4 or am I required to select one of the married options? Also, is it beneficial to select married filing jointly (with 1 allowance) opposed to single (with 0 allowance) on the W-4? I don’t want to have any tax liabilities during tax season; I’d rather have a return.
Hi William,
Congratulations on getting married!
The IRS strongly encourages taxpayers to update their filing status with any changes as soon as possible. The reason being is that the W-4 form should reflect on your tax return at the end of the financial year. If you never update your W-4 form and then claim a different filing status on your tax return, it could cause a major discrepancy on your refund amount. The most beneficial filing status is married filing jointly. You have the choice to still withhold at a single rate (you will see this option on the W-4 form) if you would prefer to do that. Keep in mind then that you will not benefit as much as possible with that status.
I am married with one child. We file jointly. How many allowances should I claim? Should we each claim on our W-4 forms or just one? If just one, which one? Last year we owed but did not have a child. Should we just claim 0 and hope to not owe any this year?
Thanks
Hi Kylie,
Congrats on the new addition! Something to remember with a qualifying child dependent is that you can typically expect more money come tax time. With that in mind, you should still expect a refund back if you decide to claim more than zero allowances on your W-4 form. If one of you still prefers to claim zero allowances, then the spouse earning the higher income is better off claiming the majority of allowances. This will be reflected on your tax return when you file at the end of the financial year.
I used the calculator at the beginning of the year. I am single, and am claiming one child. My ex is claiming our other child. I have mortgage interest also. Other than that, nothing major. The calculator said I should claim 6 to come close to breaking even. Does this sound right?
Thanks
Hi Jeff,
The information you enter into the Withholding Calculator will provide you with the maximum amount you can claim on your W-4 form. However, based on the information you have provided above, I would suggest claiming two allowances on your W-4 form (three allowances if you are also eligible to file as head of household). This most likely land you at the break even point come tax time.
I am a single mom of three and just started working this week. I am not sure how many dependents I should put on my w-4? I want to have decent checks during the month but have a nice return at the end of year taxes. Please help?
Hi Sarah,
Based on the information you have provided, claiming three allowances would likely be your best bet (assuming you are the parent able to claim all three dependents on your tax return come time to file). Claiming three will allow you to have enough tax withheld throughout the year to cover taxes to the IRS but also allow for you to have a substantial amount of take-home pay.